A home appraisal is a critical step in the home buying and selling process, and it’s one that could make or break the deal for either side. For buyers and sellers, it’s important to know what an appraisal is, how an appraiser makes an evaluation, and how the outcome of an appraisal could affect your strategy in a real estate deal.
Things can get tricky when closing a deal, for both buyer and sellers.
A home appraisal is an expert opinion of a home’s value and it ensures the lender that their loan will be well-spent, or at least up to par with the agreed selling price. Since the buyer is borrowing from the bank, they will cover the cost of the home appraisal.
A home appraiser is a licensed professional who has completed the required training, apprenticeships, and exams to carefully and impartially provide opinions about the value of real property, according to the Appraisal Institute, the world’s leading organization of professional real estate appraisers.
That means your appraiser is not going to give a low estimate because they didn’t like your furniture, or the paint color on the kitchen walls. But rather, according to the Appraisal Institute, appraisers assemble a series of facts, statistics, and other information regarding specific properties, analyze this data, and develop opinions of value. The appraisal may also include recent sales information for similar properties, the current condition of the property, and the location of the property insight as to how the neighborhood impacts the property’s value.